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Fundraising Fundamentals, Section 13.1

HEFCE

Setting Achievable Targets

It is important to have realistic expectations about what a start-up development office can achieve and to express these expectations as key performance indicators (KPIs) so that progress toward achieving them can be monitored.

It is also important to begin with an understanding, from the institution’s leader, of any operational ground rules you must follow (e.g., an agreement around how the development office makes best use of the vice-chancellor or principal’s time – by providing ‘just in time’ briefings, by giving as much notice as possible of events, etc.).

Key Performance Indicators

While an office is establishing itself, the emphasis of monitoring should be focused on levels of activity rather than on income.

A fledging office is unlikely to have sufficient mature relationships with prospects to draw in significant levels of income. However, staff in the new office can respond to targets such as:

  • The number of people they are in contact with,
  • How often they contact people,
  • How often they meet with prospects and
  • The number of asks they make.

There might also be some very specific KPIs relating to the particular circumstances of each individual office, such as:

  • The volume of data ‘cleaned’,
  • The number of lost alumni ‘recovered’,
  • The number of staff recruited and inducted,
  • The number of internal engagement meetings held,
  • Progress toward articulating the case for support,
  • Progress toward establishing systems, processes and policies and
  • Setting a strategy for the development office.

KPIs should reflect the individual circumstances and goals of each development office. They should be agreed upon with the institution’s leader and regularly reviewed to ensure that they continue to be appropriate.

As an office matures, financial KPIs become more prominent but these should not only relate to the value of gifts but to their future sustainability. For example:

  • Total gift income (split into single gifts and regular gifts),
  • Total pledged income (i.e., future gifts),
  • Total number of gifts,
  • Total number of donors (subdivided relating to the amount they gave) and
  • Pipeline of donors.

You may have circumstances where you have a fantastic total gift amount but it comprises three one-off gifts from three donors who are unlikely to give again. Looking at where the gifts come from as well as their value is a better indicator of the success and the future outlook of the office.

You might also want to split your financial reporting into ‘sources’ – annual fund, major gifts from individuals, corporate gifts, income from trusts and income from legacies. By doing this, you should be able to work out (at least roughly) the return on investment for each method of fundraising that will help inform your future investment strategies.

Any KPIs you decide upon should also be used as the basis for targets/goals for development staff, but these targets should be realistic. For example, as a newly appointed development director, you may be unlikely to fit in 200 donor visits in the first year while you are establishing the office and unlikely to have sufficient known prospects to visit. Fifty visits might be more realistic in the first year.

Talking to other development offices and looking at benchmarking data from comparable institutions should help you set targets and KPIs that are realistic and achievable.


Action Items
  • When defining your relationship, roles and responsibilities with the institution’s leader, make sure expectations are put into concrete KPIs that are appropriate for the stage of your office, mirror your fundraising efforts and development office priorities and are agreeable to both parties.
  • Determine ground rules to establish good working practices between the intuitional leader and the development director, as well as between the development office and other institutional staff.

You Might Also Want to Read:

Reasonable expectations
ROI: The level of returns that can be expected
Developing a fundraising strategy
Staff performance management
What to measure and what to report

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CASE provides in-depth information on assessment and benchmarking, including a benchmarking toolkit and a white paper on the Performance Management Maturity Model (as an example of how you can improve your office's fundraising performance as KPIs evolve).

Adrian Salmon discusses the growth of income and how it relates to donor participation, as well as what to measure and what to invest in.
McCallum describes key performance indicators that lead to giving, and how that informs his institution's cultivation model.
Doyle talks about setting goals for the first yet, measuring performance and setting expectations when hiring.
Wood talks about why development professionals should use KPIs.
Leisl Elder talks about key performance indicators.